New Delhi/Mumbai, Feb. 16: Ranbaxy Laboratories has floated $400-million zero-coupon foreign currency convertible bonds. This is, so far, the single largest capital raising exercise by an Indian healthcare company.

“The proceeds from this offering will be used to fund potential acquisitions and finance our capital expenditure plans,” said Malvinder Mohan Singh, chief executive officer and managing director, Ranbaxy.

The bonds have a tenor of five years and one day and are convertible into equity shares at a premium of 60 per cent to the company’s closing price of Rs 447.70 on Bombay Stock Exchange on Wednesday.

The offer also includes an over-allotment option of up to $40 million additional bonds.

The yield-to-maturity of the bonds is set at 4.8 per cent per annum. Citigroup, Deutsche Bank, Morgan Stanley and UBS acted as book-runners to the transaction.

“International institutional investors continue to support our business strategy and capital raising plans,” Singh said.

The company has recently entered into a 70:30 joint venture agreement with the Community Investment Holdings of South Africa to form Sonke Pharmaceuticals Ltd, which will sell Ranbaxy’s anti-retroviral products in that country and other African markets, including Namibia and Botswana.

For the year ended December 31, 2005, the company has recorded a consolidated sales of Rs 5,195.6 crore, down 2 per cent from Rs 5,313 crore recorded in the previous fiscal. In dollar terms, global sales were similar to last year’s. Profit after tax and minority interest, however, declined by 62 per cent to Rs 259.1 crore from Rs 698.6 crore achieved in 2004.